Marketing is a business term that means many things to different people. Many individuals confuse it with advertising,which is just one of many facets of the marketing mix. Marketing covers many areas such as: Branding, Design, Pricing, Direct Mail, Web sites, Exhibitions, Consumer Preference Analysis, Brochures and Advertising.
Marketing covers everything that is involved in and required to eventually sell your product or service to your audience and many commentators refer to the 4 P’s of marketing or the ‘marketing mix’.
The 4 P’s of marketing are: Product, Price, Placement and Promotion.
Product covers the physical aspects or intangible traits of the product or service you are aiming to sell. It can include packing, appearance or guaranty for example.
Pricing should take into consideration profit margins and the pricing of your competition. It should also include areas such as reductions and financing options. Understanding your margins is a critical area for every business. The margin, frequently called your ‘Gross Profit ‘ is the remaining difference between the selling cost of an item and the price you paid for it.
EXAMPLE: Richard is planning to sell beach towels for 9.99 and he will buy them for 4.99. His margin is calculated as:
– Suggested selling price: 9.99
– Cost: 4.99
– Gross Profit or Margin 5.00
Based on this margin, and if Richard knows the final cost of his overheads, he will be able to accurately work out how many products he needs to sell before he can break even.
As you can see from the example above, the price at which you sell your product or service has got to be sufficient to generate enough profit to at least cover your expected expenses based mostly on your estimated volumes. Of course, the price you set has also got to pay attention to the current prices in the market, ie. The average price that your competitors are selling the same product for.
Placement covers everything necessary to distribute your product or service to your target market. Characteristic questions you’ll need to ask yourself might include:
– Are you going to sell online, from a shop or door to door?
– How will your customers pay for your products?
– Is delivery or distribution involved?
– Will stock control and warehousing be necessary?
Promotion covers how you will communicate with your target sector and will include advertising, tele-marketing, press, direct mail, newsletters and other mediums.
Shoppers are frequently central to your marketing and crucial to the success or failure of your business. Try and think about the profile of your future customer. This should help you to understand and focus on your target audience.
After you understand marketing you should then turn your attention to branding and making your mark. With the structure and name of your business, product or service now secured, you should then try to convey what it is you do best using effective branding and brand communication.
Author Robert Irwin has a wealth of experience in the business management sector and in buying and selling antiques. Thirty years of consulting for and running both profit-making online and high street busineses has given him a wholly unique viewpoint when it comes to the basic management skills required to be successful
